NEWS13 October 2021

Nobel economics prize rewards natural experiments

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SWEDEN – David Card, Joshua Angrist and Guido Imbens have been jointly awarded the Nobel prize for economics for work using ‘natural experiments’ to understand more about the labour market and draw conclusions about cause and effect.

David Card

Natural experiments involve researchers using real-life situations, including chance events and policy changes, to study impacts on the world and groups of people. 

David Card, professor of economics at the University of California, Berkeley (pictured), has analysed the effects of minimum wages, immigration and education on the labour market using natural experiments. The results of his studies have shown that increasing the minimum wage does not necessarily lead to fewer jobs. 

He was awarded the prize for his empirical contributions to labour economics.

Card shares the prize with Joshua Angrist of Massachusetts Institute of Technology (MIT) and Stanford University’s Guido Imbens, who were awarded for their methodological contributions to the analysis of causal relationships. Their work has highlighted how conclusions about cause and effect could be drawn from natural experiments.

Peter Fredriksson, chair of the economic sciences prize committee, said: “Card’s studies of core questions for society and Angrist and Imbens’ methodological contributions have shown that natural experiments are a rich source of knowledge. 

“Their research has substantially improved our ability to answer key causal questions, which has been of great benefit to society.”

Image credit: UC Berkeley